Published by Executive Office for United States Attorneys

Department of Justice Washington

April 28 1967

United States

DEPARTMENT OF JUSTICE

Vol 15No

UNITED STATES ATTORNEYS

BULLETIN

Vol 15 April 28 1967 No

TABLE OF CONTENTS

Page

TAX DIVISION

Tax Returns Obtaining Copies of Special Notice 205

ANTITRUST DIVISION

CLAYTON ACT SUPREME First City 206

COURT REVERSES DISTRICT National Bank of

COURT AND REMANDS TWO Houston et al and

BANK CASES FOR TRJAL Provident

National Bank et al

SHERMAN ACT NEWSPAPER Lindsay-Schaub 208

IN ILLINOIS CHARGED WITH Newspapers Inc

VIOLATING SECTIONS ANDOF ACT

CIVIL DIVISION

TRADING WITH THE ENEMY ACT

Persons Late in Filing Suit to Honda etal Clark 210

Recover Debt Claimst Attorney General

Under Act May Recover Out

of Vested Assets Remaining

After Timely Claims Have

Been Satisfied

ADMIRALTYExclusive Remedy Provided Aho 211

Govt Seamen by Federal

Employees CompensationAct Not Affected by Prin

ciples of Reed The Yaka

373 U.S 410

CONSTITUTIONAL LAW CRIMINAL CONVICTIONS BY NONARTICLE III COURTS

Constitutionality of Courts Rose McNamara 211

Run by Defense Department in Okinawa Upheld

Page

CIVIL DIVISION CONTDFALSE CLAIMS ACT

False Claims Act Held In- Neifert-White 212

applicable to Applications Cofor Govt Loans

TORTSDecision of Dept of Justice to Smith 213

Prosecute or Investigate

Alleged Lawbreakers Held

Discretionary Function

Within Exception of Tort

Claims Act

Under Civil Air Regulations rilley 214

Pilot of Commercial Air

plane in Control Zone Is

Primarily Responsible for

Operation of Plane

INSURANCE FEDERAL MEDICALCARE RECOVERY ACT

Held Entitled to Recover Government Employees 214

as Insured Under Uninsured Insurance CoMotorists Endorsement of

Automobile Liability Insur

ance Policy

SMALL BUSINESS INVESTMENTACT

SBA May Require Small Busi- Wyatt Investment Corp 215

ness Investment Companies SBA

to File Program Evaluation

Reports and May Suspend

Licenses for Failure to Do So

SOCIAL SECURITY ACT

Secretarys Denial of Benefits Lane Gardner 216

to Disability Claimant With

Permanent Impairment Upheld Where Secretary Has

Shown Claimant Was Able

to Engage in Other Jobs in

II

Page

CIVIL DIVISION CONTDSOCIAL SECURITY ACT CONTD

Vicinity Proof That Particular Client With Particular

Injury Could Obtain Presently

Open Job at Some Named and

Identified Con-irnercial Enter

prise Not Required

TORTSNot Liable for Death Re- Smith et al 217

suiting From Unpredictable

Side Effect of Drug CornpazineDue to Idiosyncrasy of Patient

CRIMINAL DIVISION

FRAUDCivil Discovery While Criminal Simon et al 219

Action Is Pending

EXECUTIVE OFFICE FORATTORNEYS

New Appointments zzi

IMMIGRATION AND NATURALIZATIONSERVICE

IMMIGRATIONDenial of Visa Petition ex rel Jamshid 222

Nourani District

Director

TAX DIVISION

Appeals 1966 Amendments to Special Notice 224Federal Rules

INJUNCTIONCollection of Decedent Taxes Lawrence 225

From Heir Precluded

FEDERAL RULES OF CRIMINALPROCEDURE

RULEPurpose and Construction Simon 227

Ill

PageFEDERAL RULES OF CRIMINALPROCEDURE CONTD

RULE 7fBill of Particulars Birrell 228

RULE 26

Evidence Dovico 229

RULE 38a2Stay of Execution Levine Willingham 230

RULE 54b4Trials Before Commissioners U.S Bishop et al 231

RULE 57bRules of Court Procedure Not Simon 233

Otherwise Specified

Iv

205

SPECIAL NOTICE

OBTAINING COPIES OF TAX RETURNS

The Treasury Department has asked that all agencies use restraint in

obtaining copies of tax returns The Department of Justice appreciates the

concern of the Treasury Department over unwarranted disclosure of infor

mation All requests for returns should be examined to make sure it is

necessary to the proper discharge of your responsibilities as representatives of the United States Your attention is directed to Treasury Regulation

301 6103a 1g and as to the proper procedure to be used in request

ing copies of returns

206

ANTITRUST DIVISION

Assistant Attorney General Donald Turner

SUPREME COURT

CLAYTON ACT

SUPREME COURT REVERSES DISTRICT COURT AND REMANDS TWOBANK CASES FOR TRIAL

United States First City National Bank of Houston et al No 9141966 March 27 1967 DJ File 60-111-1081

United States Provident National Bank et al No 972 1966March 27 1967 DJ File 60-111-1003

These civil suits were filed by the United States under Section of theClayton Act to prevent two bank mergers one in Houston Texas betweenFirst City National Bank of Houston and the Southern National Bank of

.1 Houston and one in Philadelphia Pennsylvania between the Provident National Bank and the Central Penn National Bank The Comptroller had approved the mergers under the Bank Merger Act of 1966 That Act providesthat merger whose effect may be substantially to lessen competition isunlawful unless the anticompetitive effects of the merger are clearly outweighed in the public interest by the probable effect of the transaction in

meeting the convenience and needs of the community to be served TheComptroller intervened The district courts dismissed the Governmentscomplaints on the ground that they failed to state cause of action In theHouston case the Court held that in addition to pleading violation of Section

the Government should have alleged and proved under the Bank MergerAct that the anticompetitive consequences of the merger were not clearlyoutweighed in the public interest by the banking factors In the Philadelphiacase the Court held that the Government had the same burden of proof

The Supreme Court Justice Clark not taking part unanimously heldthat the failure of the Government to base these actions on the Bank MergerAct of 1966 does not constitute defect in the pleadings Section of theClayton Act condemns mergers where the effect of such acquisition may besubstantially to lessen competition The Bank Merger Act of 1966 theCourt noted does not change that standard but merely provides new defense to Section in the convenience and needs clause Banks proposingmergers which the Government proves to be in violation of the competitivestandards of Section must carry the burden of establishing that the mergerfalls within the exception created by the new defense

207

Section 1828c7B of the 1966 Bank Merger Act provides that in

judicial proceeding attacking merger on the ground that it violates the

antitrust laws the standards applied by the court shall be identical with

those the banking agencies must apply And 12 1827c7A states

that In any such action the court shall review de novo the issues presentedRejecting defendants contention that this phrase--review de novo- -directed

the court to give presumptive weight to the banking agencys views the Court

held that traditionally in antitrust actions involving regulated industries

the courts have never given presumptive weight to prior agency decision

for the simple reason that Congress put such suits on different axis than

was familiar in administrative procedure United States Radio

Corporation of America 358 U.S 334 United States El Paso Natural

Gas Co 376 U.S 651 United States Philadelphia National Bank and

Trust Co 376 U.S 665 The Court found no indication that Congress in-

tended different result under the 1966 Act Accordingly the Court stated

that it is the courts judgment not the Comptrollers that finally determines

whether the merger is legal

The Court also rejected defendants argument that the courts would be

assuming non-judicial responsibilities by determining whether the anti

competitive aspects of the merger were clearly outweighed by the banking

factors The Court noting that the courts have often administered the rule

of reason in cases requiring weighing of competitive and other factors

found no constitutional problems here not present in those cases In addi

tion the Court stressed that the convenience and needs defense under the

1966 Act is related though perhaps remotely to the failing-company doc

trine long known to the courts in antitrust merger cases

The 1966 Act provides that timely antitrust action shall stay the effectiveness of the agencys approval unless the court shall otherwise speci

fically order l828c7A Interpreting this provision the Court held

that the stay should remain in effect until the antitrust litigation has run its

course The Court also indicated that stay should normally be granted

unless the Governments complaint was frivolous The Court felt such an

interpretation was required to avoid the necessary unscrambling of the

merger--a primary concern of Congress when it passed the 1966 Bank

Merger Act

The cases were argued by Mr Turner

Staff Assistant Attorney General Donald Turner Antitrust DivisionRichard Posner Solicitor Generals Office Stephen

Breyer Lawrence Meyer Thomas Asher and Jonathan

Rose Antitrust Division

208

DISTRICT COURT

SHERMAN ACT

NEWSPAPER IN ILLINOIS CHARGED WITH VIOLATING SECTIONSAND 01 ACT

United States Lindsay-Schaub Newspapers Inc Civ 67-48DMarch 27 1967 DJ File 60-127-65

On March 27 1967 civil action was filed in the United States DistrictCourt in Danville Illinois against Lindsay-Schaub Newspapers Inc theowner of the Champaign-Urbana Courier and other newspapers published inthe State of Illinois

The complaint charges that the defendant and its co-conspirators engagedin combination and conspiracy in restraint of and to monopolize and in anattempt to monopolize the dissemination of news and advertising throughdaily and Sunday newspapers of general circulation published in the Champaign-Urbana Illinois area in violation of Sections and of the Sherman Act

The substantial terms of the offenses charged were that the defendantand its co-conspirators did among other things the following

Intentionally operated the Courier at substantial annual losseswhich in many years totaled approximately $500000 per year

Subsidized the Couriers losses out of the profits derived byLindsay-Schaub and its subsidiaries from publishing and circulating local newspapers in communities other than Champaign-Urbana Illinois

Sold at special reduced rates national advertising in the Courierin combination with the Decatur newspapers

Sold subscriptions to the Courier at unreasonably low pricesparticularly in the years prior to the commencement of the

Governments investigation of Lindsay-Schaub

Sold local advertising space in the Courier to selected advertisers at rates lower than the Couriers published advertisingrates

Sold at special reduced rates pre-print advertising in theCourier in combination with one or more of the other newpapers owned by Lindsay-Schaub and its subsidiaries

209

Made numerous attempts to purchase from the Champaign NewsGazette Inc the News-Gazette and other properties owned

by said corporation or to merger the News-Gazette with the

Courier

On the same date the complaint was filed there was also filed stipulation and final judgment consented to by the parties The stipulation provided in part that the Government may withdraw its consent to the final

judgment anytime within the 30-day period commencing with the date of

filing

The final judgment among other things enjoins the defendant from

Refusing to contract to sell or refusing to sell advertising in the

Courier separate from its other newspapers

Selling advertising in the Courief in combination with its other

newspapers at special combination rate

Maintaining advertising or subscription rates below those of its

competitor in Champaign-Urbana for the purpose or with the

necessary effect of eliminating competition

Acquiring or selling any stock or any financial interests in the

business of competing Champaign-Urbana newspaper

Stf Bertram Long James Mann and William HuyckAntitrust Division

.L

210

CIVIL DIVISION

As sistant Attorney Gene ral Barefoot Sanders

SUPREME COURT

TRADING WITH THE ENEMY ACT

PERSONS LATE IN FILING SUIT TO RECOVER DEBT CLAIMS UNDER

ACT MAY RECOVER OUT OF VESTED ASSETS REMAINING AFTER TIMELY

CLAIMS HAVE BEEN SATISFIED

Ayako Honda et al Ramsey Clark Attorney General No 164

Oct Term 1966 April 11 1966 DJ File 9-21-2935

The Supreme Court reversed decision of the Court of Appeals for the

District of Columbia Circuit and held that suit by some 4000 Japanese-

Americans under 34 of the Trading With the Enemy Act 50 U.S App 34

for payment of their debt claims out of the vested assets of Japanese bank

seized during World War II was timely filed Petitioners suits challenging

the Attorney Generals rejection of their debt claims were not instituted

within the 60-day period prescribed in the statute 50 App 34fHowever analogizing the debt claims legislation to proceedings in bank

ruptcy the Court pointed out that one who file.s late claim in bankruptcy

proceedings is not absolutely barred from all recovery but may share in any

assets remaining after the timely creditors have been paid The Court ruled

that the Congressional purpose in allowing debt claims suits would be best

served by giving similar treatment to the limitations provisions of section

34 The Court held that the limitations period was tolled pending disposi

tion of prior timely suit by persons with similar debt claims and that peti

tioners were entitled to have their own claims satisfied out of any vested as

sets remaining after disposition of the timely suit

In reaching this result the Court stressed that the Government was

mere stakeholder in the action the money in suit would be paid out to

different class of claimants if the Japanese-Americans had not prevailed

and that the usual rules regarding the jurisdictional nature of statutes lim

iting the time for suit against the United States were inapplicable

Staff Richard Posner Office of the Solicitor General

David Rose Richard Salzman Civil Division

211

COURTS OF APPEALS

ADMIRALTY

EXCLUSIVE REMEDY PROVIDED GOVERNMENT SEAMEN BY FEDERAL EMPLOYEES COMPENSATION ACT HAS NOT BEEN AFFECTED BYPRINCIPLES OF REED THE YAKA 373 U.S 410

Andrew Anthony Aho United States C.A No 23866 March 231967 D.3 File 61-32-445

Mr Aho Government seaman brought this libel in admiralty against

the United States for injuries and ailments aggravated by service on two Government vessels The Government moved for summary judgment on the

ground that libellants exclusive remedy was under the Federal EmployeesCompensation Act The district court granted the Governments motion for

summary judgment rejecting libellants c.ontention that it could sue under

the Suits in Admiralty or Public Vessels Act

On appeal libellant relied upon Reed The Yaka 373 U.S 410 in

which the Supreme Court had held that where the same party was both the

stevedore and shipowner such party as shipowner could be held liable in

personal injury action to longshoremen-employee despite the exclusivity

provision in the Longshoremen and Harbor Workers Compensation Act Libellant in this case argued that the principle of The Yaka was applicable to

this action against the Government by Government-employed seaman TheFifth Circuit however affirmed holding that the Supreme Courts decision

in The Yaka was not applicable to this case The Court of Appeals invoked

the well-settled principle that the Federal Employees Compensation Act provided the exclusive remedy against the United States by Government-

employed seaman

Staff Jack Weiner Civil Division

CONSTITUTIONAL LAW CRIMINAL CONVICTIONSBY NON-ARTICLE III COURTS

CONSTITUTIONALITY OF COURTS RUN BY DEFENSE DEPARTMENTON OKINAWA UPHELD

Eiko Rose McNamara C.A D.C No 20323 March 23 1967DJ File 145-15-90

Appellant naturalized American citizen residing in Okinawa was convicted by jury in the Superior Court of the United States Civil Administra

tion of the Ryukyu Islands USCAR for evasion of the Ryukyu Islands income

212

tax by failing to report income she derived from operations of Tea House

August Moon Mrs Rose brought declaratory judgment action in which she

challenged the constitutionality of the USCAR courts on the ground that they

were established pursuant to an Executive Order rather than by Congressunder Article Ill of the Constitution The Court of Appeals affirmed the decision of the district court upholding the validity of the Court The Court of

Appeals rejected appellants contention that she could be tried for crime

only in an Article III court Citing Madsen Kinsella 343 341 the

Court of Appeals said that there was an extensive power in the President

absent Congressional provision to set up special tribunals in occupied for

eign lands to try American citizens for crime that this power sometimes

may survive the cessation of hostilities and that under the special circum

stances of our relationship to Okinawa which this country controls on an in

terim basis with the expectation of eventual restoration to full Japanese sov

ereignty that power can survive the 1952 Treaty of Peace with Japan

The principal significance of this decisi.on is its refusal to construe Reid

Covert 354 U.S as requiring that American civilians residing abroad

be tried only in courts established by Congress

Staff Walter Fleischer Civil Division

FALSE CLAIMS ACT

ACT HELD INAPPLICABLE TO APPLICATIONS FOR GOVERNMENTLOANS

United States Neifert-White Company C.A No 2945 372 2d

372 January 20 1967 D.J File 120-44-88

The NeiIert-White Company applied for low interest Government loans

from the Commodity Credit Corporation which applications were based on

invoices deliberately falsified to overstate the costs of the items to be fi

nanced by the loans and upon which invoices the was intended to and

in fact did rely in approving the Government loans In the Governments

suit for penalties under the False Claims Act 31 U.S.C 231 the district

court rendered judgment for the company and the Ninth Circuit affirmed The

Court of Appeals held that the False Claims Act applies only to assertions

of legal right against the government i.e claims of entitlement to public

monies as matter of right as distinct from mere applications for Government loans

The Court reached its conclusion principally on its reading of the Su

preme Courts decision in United States Cohn 270 U.S 370 We believe

that the Court of Appeals misinterpreted Cohn which case turns on the fact

that Cohn did not attempt to obtain anything of value from the United States

213

We also think that the Ninth Circuits error is pointed up by the SupremeCourts language in the later case of U.S ex rel Marcus Hess 317 U.S537 544-545 where the Court stated that the False Claims Act was intended

to reach any person who knowingly assisted in causing the government to

pay claims grounded in fraud without regard to whether that person had direct contractual relations with the government

The decision of the Ninth Circuit conflicts in result if not in holding

with decisions of several other Courts of Appeals See United States

Lagerbusch 361 2d 449 C.A 1966 United States Alperstein 291

2d 455 C.A Smith United States 287 Zd 299 C.A United

States Rainwater 244 Zd 27 C.A affirmed 356 U.S 590 Sell

United States 336 2d 467 C.A 10 United States Brown 274 2d

107 C.A Toepleman United States 263 Zd 697 C.A See alsoUnited States Cherokee Implement Co 216 Supp 374 N.D IowaThe question of certiorari is now being considered by the Solicitor General

Staff Alan Rosenthal Lawrence Schneider Civil Division

TORTS

DECISION OF DEPARTMENT OF JUSTICE TO PROSECUTE OR INVESTIGATE ALLEGED LAWBREAKERS HELD TO BE DISCRETIONARY FUNCTION WITHiN EXCEPTION OF TORT CLAIMS ACT

Alex Carl Smith United States CA No 23305 April 1967D.J File 157-19M-198

During 1963 plaintiffs store in Albany Georgia was picketed by civil

rights groups allegedly because of his prior service on federal jury and

verdict assented to by him Plaintiff brought this action under the Tort

Claims Act for damages caused by the picketing He alleged that he had requested the United States Attorney and the F.B.I to investigate and prosecute the picketers for violation of 18 S.C 1503 that after an initial inves

tigation to ascertain that the attorney for the losing party in the original lawsuit was not involved in the picketing the United States Attorney and the

F.B.I refused to take further action and that as result of such inaction

plaintiffs business was destroyed The district court dismissed the corn-

plaint for failure to state claim and the Fifth Circuit affirmed

The Court of Appeals held that the acts charged in the complaint fell

within the discretionary function exception of 28 U.S 2680a Rejecting the planning operational distinction argued by plaintiff as speciousand so finespun and capricious as to be almost incapable of being held in the

mind for adequate formulation the Fifth Circuit held that the real question

was the nature and quality of the discretion involved in the acts complained

214

of The discretion of the Attorney General the Court held in choosingto prosecute or not to prosecute or to abandon prosecution already started

is absolute This discretion it noted exercised in even the lowliest

and least consequential cases can affect the policies duties and success of

function placed under the control of the Attorney General by our Constitution

and statutes Therefore as the Court of Appeals went on to hold 28

2680a exempts the government from liability for exercising the discretion

inherent in the prosecutorial function of the Attorney General no matter

whether these decisions are made during the investigation or prosecution of

offenses

Staff Robert McDiarmid Civil Division

UNDER CIVIL AIR REGULATIONS PILOT OF COMMERCIAL AIRPLANEIN CONTROL ZONE IS PRIMARILY RESPONSIBLE FOR OPERATION OFPLANE

Gordon Tilley United States C.A No 10 732 April 1967File 157-67-342

Plaintiff passenger in Delta DC-8 brought suit against Delta and

the United States alleging back injury when the nosewheel of the plane went

off the runway at Kennedy International Airport New York in the course of

the planes being turned around in response to instructions from the control

tower to the pilot to clear the runway and return to the taxiway The juryexonerated Delta but in the Federal Tort Claims Act case tried to the judgethe district court found the air traffic controller negligent in spacing the

planes when he cleared Delta to taxi onto the runway and hold and in subsequently instructing the pilot to clear the runway back to the taxiway

On appeal the Court of Appeals reversed It found that on the recordthe controllers instructions were proper both in spacing the planes on the

runway and later in instructing the Delta plane to clear the runway so that

another plane could land Further it found that the controller did not undertake to instruct the pilot in the physical operation of the plane in turning it

around The Court held that under applicable Civil Air Regulations of the

F.A.A the pilot has the primary responsibility for the operation of the aircraft and that the controller cannot give his undivided attention to one planebut must give his attention to all aircraft in the control zone

Staff Kathryn Baldwin Civil Division

INSURANCE -- FEDERAL MEDICAL CARE RECOVERY ACT

UNITED STATES HELD ENTITLED TO RECOVER AS INSURED UNDERUNINSURED MOTORISTS ENDORSEMENT OF AUTOMOBILE LIABILITY INSURANCE POLICY

215

Government Employees Insurance Company United States

No 10 756 April 1967 File 77-79-950

The United States brought this action for declaratory judgment that it

was an insured under the uninsured motorists provisions of an automobile

liability insurance policy is sued by GEICO to private individual and that

therefore its claim against an uninsured motorist for the amount of medical

care furnished to dependent of member of the Armed Forces was covered

by the policy The policy obligated the company to pay all sums which the

insured was legally entitled to recover as damages from the owner or

operator of an uninsured automobile because of bodily injury sustained by the

insured in an accident involving the uninsured automobile The policy defined insured to include the named insured and any relative any occupant of the insured automobile and any person with respect to damageshe is entitled to recover because of bodily injury sustained by an insured

under or above

The district court entered judgment for the United States and the Court

of Appeals affirmed The Court of Appeals reasoned

The United States by the provisions of the Federal Medical

Care Recovery Act 42 U.S C.A Section 2651 is given an

independent right to recover of tortfeasor the value of medical

care furnished an injured person to whom it owes legal duty to

furnish such case Krebs military dependent was admittedly

person to whom the United States owed the duty of furnishing

medical care he was also person occupying the insured

car entitled torecover under the uninsured motorist clause

of appellantspolicycovering such car In this situation the

United States as the district court held clearly meets the definition set forth in subsection of Part IV of appellants policy

as person entitled to recover damages of the uninsured tortfeasor because of injuries sustained by Krebs

The decisions in this case constitute the first court determinations that the

United States may recover on such insurance contracts for hospital and medical care and treatment so furnished

Staff Howard Kashner Civil Division

SMALL BUSINESS INVESTMENT ACT

SBA MAY REQUIRE SMALL BUSINESS INVESTMENT COMPANIES TOFILE PROGRAM EVALUATION REPORTS AND MAY SUSPEND LICENSESFOR FAILURE TO FILE THOSE REPORTS

216

Wyatt Investment Corp SBA No 6837 March 1967File 106-36-146

Petitioner who was licensed by SBA to do business as small business

investment company failed to file the program evaluation reports required

by SBAs regulation 13 107 802i as amended by 31 Fed Reg 4954Such reports contain financial and other information on small business con-

cerns that have been financed by the SBA investment company Petitioner

admitted failure to file the reports but contended that SBA had no authority

under the statute to require the filing of those reports In addition petitioner

contended that since the reports would be used for providing information for

Congressional use in considering possible further legislation with respect to

the small business investment company program SBAs regulation constitutes

an unconstitutional assumption of legislative functions Moreover petitioner

contended that the suspension of his license until it filed the program evaluation reports was unreasonable as petitioner had no legal right to require the

small business concerns that it had financed in the past to supply that information Finally petitioner contended that SBA which had instituted licensing

suspension proceedings was required to hold an evidentiary hearing and to

permit an oral argument

The First Circuit dismissed the petition to review the SBAs order suspending petitioners license until it filed the program evaluation reports In

per curiam opinion the Court of Appeals stated

The contention that the Small Business Administration cannot

frame regulation specifically 13 107 802i as amended31 Fed Reg 4954 conditioning the continuance of the license of

small business investment companies upon the furnishing of so-

called program evaluation reports is too ill founded to requirediscus sion

Staff Alan Rosenthal and Leonard Schaitman Civil Division

SOCIAL SECURITY ACT

SECRETARYS DENIAL OF BENEFITS TO DISABILITY CLAIMANTWITH PERMANENT IMPAIRMENT UPHELD WHERE SECRETARY HASSHOWN THAT CLAIMANT WAS ABLE TO ENGAGE IN OTHER JOBS IN

VICINITY PROOF THAT PARTICULAR CLIENT WITH PARTICULAR INJURYCOULD OBTAIN PRESENTLY OPEN JOB AT SOME NAMED AND IDENTIFIEDCOMMERCIAL ENTERPRISE NOT REQUIRED

James Lane Gardner C.A No 16660 March 10 1967File 137-70-ill

217

After the Secretary had denied Social Security disability benefits to

claimant who allegedly became permanently disabled at the age of 38 when

his right leg was gored by boar hog the district court reversed the Secre

tarys decision and ordered that benefits be granted The Sixth Circuit reversed holding that although claimant had an admittedly permanent impairment rendering him unable to engage in his prior occupation the Secretary

had nevertheless sustained his burden of showing that claimant was able to

engage in lighter work in jobs which existed and were being performed in the

vicinity of claimants residence vocational expert had testified that there

existed in the metropolitan area about 000 jobs which could be performed

by the claimant but he did not know of specific job in specific plant that

would be available to claimant The Sixth Circuit held that this was suffi

cient proof as there is no requirement that the Secretary demonstrate that

the particular plaintiff with his particular injury--a drop-foot--could obtain

presently open job at some named and identified commercial enterprise if

he applied for it

Staff Florence Roisman Civil Division

DISTRICT COURT

TORTS

UNITED STATES NOT LIABLE FOR DEATH RESULTING FROM UNPREDICTABLE SIDE EFFECT OF DRUG COMPAZINE DUE TO IDIOSYNCRASY

OF PATIENT

Debra Ann Smith et al United States Miss Civil No 3228

March 21 1966 File 157-41-140

This action under the Federal Tort Claims Act was brought for the death

of woman who had entered an Air Force Hospital for gallbladder operation

and appendectomy After the operation the patient became very nauseated

and she was given ten milligrams the maximum dosage of compazine When

she reacted adversely to the drug her physician gave her an antidote However she died several days later from side effects caused by the drug The

drug is manufactured by reputable drug house and is in common use through

out the country The drug had been used many times in the same manner on

other patients and the maufacturers literature did not warn that the drug

might be lethal if given within certain time after the operation

The district court held that doctrine of res ipsa loquitur does not

apply where it is shown that every reasonable professional attention was

giventhe patient and that injury resulted from an allergy or idiosyncrasy to

an ordinarily and reasonably safe drug The Court further held that

Z18

plaintiffs had not satisfied the burden of proving the Government doctors

negligent in giving the first dosage of this drug The Court emphasized that

the Ithospital and its doctors were not insurers of the absolute safety of their

patients or that such treatment would be absolutely free of any possible errors

or mistakes Plaintiff has noted an appeal

Staff United States Attorney Robert Hauberg Assistant United

States Attorney Holmes Miss

219

___CRIMINAL DIVISION

Assistant Attorney General Fred Vinson Jr

COURTS OF APPEALS

FRAUD

CIVIL DISCOVERY WHILE CRIMINAL ACTION IS PENDING

United States Carl Simon et al March 1967

113-51-177 The defendants were accountants for Continental Vending

Machine Coporation firm under reorganization in the Eastern District of

New York pursuant to Chapter of the Bankruptcy Act They were chargedin the Southern District of New York with mail fraud conspiracy and the

filing of false reports with SEC by reasog of financial statement they prepared for the bankrupt corporation

The Chapter trustee filed civil action against the defendants one

year prior to their indictment His efforts after the indictment to take the

depositions of the defendants were upheld in the Eastern District of NewYork The defendants thereafter moved in the Southern District of New York

to stay the depositions pending resolution of the criminal proceedings pend-

ing in that District on the grounds that the depositions would involve dis

closure of their defenses and since they were reputable accountants

they would lose their professional lives if they invoked their privilege

against self-incrimination The District Court enjoined the taking of depositions finding power under the All Writs Act 28 U.S.C 1651aand the

Courts inherent supervisory power 262 Supp 64

The Court of Appeals reversed not on the ground that the District Court

lacked power to order stay but because the defendants had not shown that

the depositions would interfere with the defense or the trial of the criminal

case It distinguished this case from those in which there is an identity of

parties in parallel criminal and civil cases such as United States Steffes

35 FRD 24 Mont 1964 and seeking of advantage by one party and

also from those in which party sought to be deposed was claiming his privilege against self-incrimination Paul Harrigan Sons Inc Enterprise

Animal Oil Co Inc 14 FRD 333 Pa 1953

The Circuit Court stated that its decision might be otherwise were there

clear showing that depositions would interfere with criminal trial

220

or with the preparation of defense It did not accept defendantst argument

that their status as accountants gave them some special privilege to refrain

from pleading their privilege against self-incrimination in order to preserve

their professional reputations

The defendants are filing petition for writ of certiorari

Staff United States Attorney Robert Morgenthau Assistant United

States Attorneys Stephen Kaufman and Hugh Humphreys

S.D N.Y.

St St

221

____________EXECUTIVE OFFICE FOR UNITED STATES ATTORNEYSAssistant to the Deputy Attorney General John Kern III

ASSISTANTS APPOIN TED

Colorado THOMAS SEAWELL ESQ Colorado Univer sity

LL and formerly in private practice

District of Columbia ROBERT BENNETT ESQ Georgetown

University LL and formerly law clerk to Federal Judge

District of Columbia DANIEL GIVELBER ESQ Harvard

University LL and formerly in private practice and Special Attorney

United States Attorneys Office District of Columbia

Missouri Western ANTHONY NUGENT ESQ Harvard

University LL and formerly an attorney in the Criminal Division

Assistant Prosecuting Attorney and in private practice

222

IMMIGRATION AND NATURALIZATION SERVICE

Commissioner Raymond Farrell

DISTRICT COURT

IMMIGRATION

DISTRICT COURT HAS JURISDICTION OF HABEAS CORPUS PROCEEDINGS NOTWITHSTANDING PETITIONER NOT IN PHYSICAL CUSTODY OFRESPONDENT AND HAS JURISDICTION TO REVIEW DENIAL OF VISA FE-

TITION DENIAL OF VISA PETITION HELD IMPROPER

ex rel Jamshid Nourani District Director Immigration and

Naturalization Service Cal No 46106 March 31 1967 File

39-11-614

In this writ of habeas corpus proceeding the petitioner an Iranian national challenged the validity of an order for his deportation and the denial

of visa petition submitted in his behalf by his United States citizen wifeJoan Nash

Petitioner entered the United States as studentin 1960 On March 261963 he married United States citizen Linda Young and upon the basis of

her visa petition approved on April 23 1963 he was accorded nonquota status

On the same date his status was adjusted from student to permanent resi

dent under U.S.C 1255 He divorced Linda Young in 1965 and married his

present wife in 1966 On February 1965 pursuant to the provisions of

1256 he was served with notice that his status as permanent resi

dent was to be rescinded because his marriage to Linda Young was invalid

Petitioner failed to answer the allegations in the notice and his permanentresident status was revoked Alter hearing he was ordered deported and

directed to surrender for deportation on December 1966 The petition for

writ of habeas corpus was filed on December 1966

The first issue decided by the Court was whether it had jurisdiction of

the writ proceedings Although respondent did not have physical custody of

petitioner when the petition was filed the Court held that the warrant of deportation and the notice to report for deportation constituted sufficient technical

custody to support habeas corpus jurisdiction The Court also ruled that in

determining the validity of the deportation order it could under the theory of

ancillary jurisdiction review the denial of the visa petition

223

Respondent had denied the visa petition of petitioners second wife pursuant to 1154c on the ground that petitioner had been previously

accorded nonquota status by reason of marriage determined by the Attorney

General to have been entered into for the purpose of evading the immigration

laws After examining the record of the U.S.C 1256 rescission proceed

ings the Court concluded that no finding had been made in those proceedings

that petitioner had entered into his first marriage for the purpose of evading

the immigrationlaws and that in fact 1256 did not require such

finding The Court then ruled that the visa petition had been improperly denied and directed petitioners release from the custody of the respondent

Staff United States Attorney Cecil Poole Chief Assistant United

States Attorney Charles Collett Cal

224

___TAX DIVISION

Assistant Attorney General Mitchell Rogovin

SPECIAL NOTICE

FILING AND DOCKETING OF APPEALS DESIGNATION OF PARTS OFTRANSCRIPT AND STATEMENT OF ISSUES

Some confusion has arisen under the 1966 amendments to the Federal

Rules of Civil Procedure as to the procedure for obtaining extensions of

time for filing and docketing the record in the Court of Appeals and the

necessity for filing designation of the parts of the transcript to be included

in the record and statement of the issues to be presented on appeal The

pertinent rules are as follows

Under Rule 73a notice of appeal nust be filed with the District

Court within 60 days of the entry of the judgment from which an appeal is to

be taken

Under Rule 73g unless an extension is obtained the appellant

must cause the record on appeal to be filed with the Court of Appeals and the

appeal to be docketed within 40 days of filing the notice of appealThe District Court may extend the time for filing and docketing

the record in the Court of Appeals but not to day more than 90 daysfrom the dae of filing the first notice of appeal provided that the motion

is filed on or before the 40th day Rule 73gThe motion of an appellant for an extension shall show that his

inability to effect timely filing and docketing is due to causes beyond his

control or to circumstances which may be deemed excusable neglect

Rule 73g

Rule 75a provides that the record on appeal shall consist of the

original papers exhibits transcript of proceedings and certified copy of

the docket entries

Rule 75b provides that Within 10 days after filing the notice of

appeal the appellant shall order from the reporter transcript of such parts

of the proceedings not already on file as he deems necessary for inclusion

in the record Unless the entire transcript is to be included the appellant

shall within the time above provided file and serve on the appellee description of the parts of the transcript which he intends to include in the record and statement of the issues he intends to present on appeal

Rule 75e provides that Within the time provided or fixed under the

provisions of Rule 73g for filing the record and docketing the appeal the

225

clerk of the district court shall transmit the record to the clerk of the Court

of Appeals The appellant shall comply with the provisions of subdivision

of this rule and shall take any other action necessary to enable the clerk

to assemble and transmit the record

The responsibility continues to rest with the United States Attorney to

see that required notices are filed or extensions are requested pending

decision by the Solicitor General as to whether an appeal will be prosecuted

See United States Attorneys Manual Title page 45 The affidavit needed

in order to make the showing required by Rule 73g for an extension of time

for docketing will ordinarily be prepared by the Tax Division attorney respon

sible for the case when the extension is requested and will be forwarded to

the United States Attorney If such an affidavit has not been received by the

United States Attorney at least three days prior to the date on which motion

for extension must be filed the United States Attorney should telephone the

Section Chief responsible for the case

Rule 75 appears to relieve an appellant of the requirement of filing

designation of record where the entire record is to be filed with the appellate

court and most district clerks no longer make such requirement If

the local district clerk so interprets Rule 75 designation need not be filed

where all the trial record is to be transmitted to the Court of Appeals If

the local clerk however takes contrary position such designation should

be prepared and filed by the United States Attorney The Tax Division

would appreciate being advised of any District where practice or rule still

requires the filing of designation If the entire transcript is not to be in

cluded the Tax Division attorney charged with the case will prepare for ser

vice and filing description of the parts of the transcript to be included in

the record together with statement of the issues to be presented on appeal

The foregoing relates to documents to be filed in the District Court rela

tive to the transmission of the record to the Court of Appeals--which are not

of course to be confused with similar documents additionally required in

some circuits to be filed in the Court of Appeals in connection with the

printing or reproduction of the record in the Court of Appeals

CIVIL TAX MATTERS

DISTRICT COURT

INJUNCTION

INJUNCTION GRANTED PRECLUDING COLLECTION BY LEVY OFDECEDENTS TAXES FROM ASSETS DISTRIBUTED BY ESTATE TO HEIR

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Lawrence United States Tex January 1967 67-1 U.S9329 D.J File 5-73-1984

The plaintiff under the will of her deceased husband was designated as

the independent executrix of the estate and as such administered the estate

independently of the Texas probate court for approximately two years until

September of 1962 In February of 1965 assessments were made against the

decedent as responsible officer of Casa View Country Club for federal excise

and employment taxes incurred prior to his death Collection of these

liabilities was attempted by levy on bank accounts in plaintiffs name

In granting the injunction against such manner of collection the Court

ruled that since the decedents estate had been closed even before the

assessment of the tax liabilities the taxes could be collected only by suit

against the sole heir as transferee of the estates assets Moreover it wasdetermined that only by such suit could the Government now establish its

claim against the decedents property

Staff United States Attorney Melvin Diggs Assistant United

States Attorney Kenneth Mighell and Joel Kay TaxDivision